Schaeffer's Top Stock Picks for '25

Does American Express Stock Have Room to Run?

Taking a closer look at AXP fundamentals

facebook X logo linkedin


Credit card company and consumer lending giant American Express Company (NYSE:AXP) will step into the earnings confessional and report second-quarter results on Friday, July 23 before the open. In recent history, American Express has beat earnings expectations on three of its last four earnings reports. However, the post-earnings reactions tell a different story.

The last four of AXP's post-earnings reactions have been to the downside, including a 4.1% drop in January. Overall, the stock averages a timid post-earnings move of 2.4% in the last eight quarters, regardless of direction.

On the charts, American Express stock scored a record high of $168.46 earlier today, and is up 39.2% year-to-date. Along the way, the shares' ascending 40-day moving average has contained pullbacks in March, April, and June. The company also has a forward dividend of $1.72 and a dividend yield of 1.04%.

AXP Stock Chart

Options are well-priced at the moment, too, from a volatility perspective. The stock's Schaeffer's Volatility Index (SVI) of 22% stands higher than 5% of all other readings in its annual range, implying that options players are pricing in relatively low volatility expectations at the moment.

From a fundamental perspective, American Express stock appears to be overvalued at the moment. AXP currently trades at a high price-earnings ratio of 27.21 and American Express stock's forward price-earnings ratio isn’t much of an improvement, coming in at 24.57.

However, AXP still has plenty of room to recover after experiencing a 16% revenue decrease and a 54% net income decline in 2020 as a result of the Covid-19 pandemic. In fact, American Express’ trailing 12-month net income is already up by 65% compared to the company's 2020 numbers. Overall, American Express stock will likely continue to see slow and steady long-term growth. Investors may want to hold off for a better entry point given its all-time highs and the tried-and-true mantra; buy low, sell high.

 
 

You have the chance to join one of Bernie's most exclusive programs, complete access at HUGE savings!

As we prepare for a new administration to take the reins in Washington, the near-term market landscape is rife with uncertainty.

The Federal Reserve has already hinted at the turbulence ahead, lowering its interest rate outlook for 2025.

Meanwhile, breakthroughs in artificial intelligence (AI), quantum computing, and other transformative sectors have unlocked incredible profit potential.

But these opportunities are fleeting, and timing is everything. That's where Quick-Hit Trader comes in.

Quick-Hit Trader is designed for precision and speed, getting you in and out of the market in a flash. While other investors scramble to navigate volatile conditions, you'll have access to expertly curated trades that leverage these rapid shifts to deliver explosive profits in short order.

This is your chance to capitalize on the fast-moving market like never before. Are you ready to make your move?

 

 

(function(doc, script) { var js, fjs = doc.getElementsByTagName(script)[0], frag = doc.createDocumentFragment(), add = function(url, id) { if (doc.getElementById(id)) {return;} js = doc.createElement(script); js.src = url; id && (js.id = id); frag.appendChild( js ); }; // Google+ button //add('https://apis.google.com/js/platform.js', async="defer"); // Facebook SDK add('//connect.facebook.net/en_US/all.js#xfbml=1&appId=772755279557744', 'facebook-jssdk'); // Twitter SDK //add('//platform.twitter.com/widgets.js', charset='utf-8'); fjs.parentNode.insertBefore(frag, fjs); }(document, 'script'));